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According to forecasts, in 2003, China’s auto production is expected to reach 4.5 million, surpassing France’s fourth largest in the world. The production of domestic cars is undoubtedly a potential for growth, but it is another major market for the automotive industry – car sales. And the service market has been slow to develop. In foreign countries, the profits of automobile services have even surpassed the profits of automobile production, becoming the largest market for the automotive industry, but the domestic service market is far from fully developed.
China will become a big automobile country. How can we cultivate the auto sales and service market? This reporter interviewed Wang Jiashan, deputy general manager of Beijing Xijiao Auto Parts City.
Focus on auto parts market
The auto parts industry is the largest segment of the automotive aftermarket. The auto parts industry is the basis of the entire automotive market. Without good parts, it is impossible to make a good vehicle. However, for a long time, China has had a tendency to re-qualify lighter vehicles in the process of developing the automotive industry. Therefore, there is a big gap between China's auto parts industry and foreign auto parts industry. China's auto parts industry must develop.
There are more than 2,000 professional auto parts production plants in China, gradually forming parts and components production groups with FAW Group, Dongfeng Group and SAIC as the backbone. There are a number of companies with considerable scale and large market share. The regional structure is also gradually concentrated. Among the 709 companies that are counted by the China Association of Automobile Manufacturers, there are 100 companies with annual auto parts sales exceeding 100 million yuan.
In 1997, the total sales of national auto parts manufacturers were 61.1 billion yuan. In the same year, the total import of automotive supplies was 1.178 billion U.S. dollars. Among them, auto parts account for about 600 million U.S. dollars.
Foreign professional manufacturers seize the Chinese market and domestic auto parts manufacturers face enormous challenges. It is estimated that the annual demand value of domestic automotive aftermarket parts is about 60 billion yuan. In 1999, the total demand for imported auto parts in China was nearly US$800 million, and it grew at an annual rate of 11% to 20%.
World-class professional parts manufacturers have entered China to establish joint ventures or wholly-owned enterprises, such as Delphi, Bosch, Toyota, etc., in China to establish a number of wholly-owned or joint ventures.
Domestic and foreign joint ventures, wholly foreign-owned companies and other accessories manufacturing enterprises have reached 415. The development of these companies has greatly reduced the gap between the level of domestic auto parts and foreign countries. At the same time, people should also pay attention to the strong financial strength and technological advantages of foreign-funded enterprises and the trend of global procurement of auto parts in the future, which has begun to threaten the survival of domestic auto parts manufacturers.
The development of China's auto parts market can be divided into four phases: planned economy, production according to plan, distribution according to plan, spare parts shortage, sellers can't sell goods without fail, and business release period, full bloom, there are accessories stores everywhere. Buying accessories is much easier; accessories are on the street, shops are concentrated, large-scale, and full-scale; in the auto parts city stage, the stores are more concentrated, and the scale is bigger and the varieties are more complete. Auto Parts City has strong comprehensive functions and complete service functions. Auto users and repair shops can purchase genuine accessories with convenience and time-saving. Operators have obtained better economic benefits. Auto Parts City is an inevitable result of China's transformation from a planned economy to a market economy, and it is an inevitable result of the continuous increase in the number of cars in China. Therefore, Auto Parts City has rapidly developed throughout the country with its unique and comprehensive features.
At present, the auto parts industry in the world presents new development features. The most compelling aspect is that auto parts companies are continuously separated from auto vehicle production plants (groups). Through mergers and acquisitions, etc., the reorganization of the organizational structure is realized, and the production and sales of parts and components are presented. The trend of internationalization and high-tech development. Some multinational car companies have implemented global procurement strategies in the supply of auto parts. As a result, the auto parts market has become increasingly important in the global automotive market. In the future, the highlight of the auto market is not the vehicle but the auto parts. The increasingly fierce competition in the automotive vehicle market has gradually extended to the auto parts market, making the auto parts market from a simple supporting maintenance market into an important part of the automotive industry that is pioneering, independent, and basic.
The auto parts market will develop from an appendage in the vehicle market into an independent and distinctive auto aftermarket. In order to develop the auto industry, China should invest more manpower, material resources and financial resources to secure the foundation of the auto parts industry.
The auto parts market is divided into two types: one is the direct supporting system market (supported to the host); the second is the after-sales service market. It is a mistake to confuse the two markets. Under this erroneous ideological guidance, people often use parts made directly by auto parts companies supplying Dongfeng, FAW, and Shanghai Volkswagen as legitimate parts, and erroneously place all auto parts that are not directly supplied to regular mainframe companies. The accessories produced by the company are used as deputy factory parts and even counterfeit parts.
The required parts for the after-sales maintenance of a vehicle model are provided by the main engine factory for a specified period of time. After this variant of the model has been sold to the country and even the world's prototype car accessories, the main plant will not be provided. But what is the demand for maintenance parts? The automotive aftermarket should satisfy the needs of users.
In the past, China used the car as a luxury product and only developed the truck industry. It did not manufacture cars. Later, as people changed their minds, our country changed this practice. Car companies are basically Sino-foreign joint ventures, and foreigners have taken a large piece of the host market through Chinese-foreign joint ventures. However, the huge profit margins of the auto aftermarket have lured them to want to occupy more auto aftermarkets. Under such circumstances, China should vigorously cultivate the automotive aftermarket and create its own brand name.
The reason why China's vehicle manufacturing market was seized by a joint venture was a large one because of its high degree of mechanization. China's advantage in this regard is insufficient, and the automotive aftermarket is labor-intensive. China's labor force is cheap, and it has the advantage of seizing the auto market. It is imperative that China should organize the automotive aftermarket to improve the quality of its work, adopt high technology, and implement modern management. Otherwise, China will certainly be passive in the automotive aftermarket.
Competition between Small "3S" and Big "3S"
The so-called "3S" refers to the trinity of vehicle sales, spare parts supply and vehicle repair.
Now, the mode of operation of China's auto aftermarket is that auto dealerships independently implement "3S" services only for single-brand automobiles. The use of such a scattered single-armed combat mode by franchised stores does not scale, and it does not produce economic benefits. Therefore, almost all the stores are shouting that they don't have enough food. We refer to the operation of these stores as the small "3S."
Only the car ownership in the society is large, and the small “3S†of the store will create benefits. The car ownership in the society is small, and the small “3S†service target of each store is less, and the benefit is not. The U.S. and Japan’s auto society have more than 100 million vehicles. Each store has a large number of service targets, and its benefits are of course very good. The small "3S" of the store is not suitable for China's national conditions. China's car ownership is small, and the entire society has only about 20 million cars owned. The share of each specialty store is very small. How can the benefits come from?
In addition, small "3S" companies must be equipped with sales personnel for auto sales, auto parts sales, and auto repair. They must also have the software and hardware conditions for logistics, inventory, and repair. In this way, a lot of money needs to be invested to establish a complicated management system. This is one of the reasons why China's small "3S" business is not doing well.
The small "3S" model of China's auto aftermarket has no future. China's auto aftermarket should completely change the status quo. We have proposed a big "3S" business philosophy.
The so-called "3S" refers to the consolidation of the vehicle sales market, parts supply market, and auto repair market for different brand cars to one place, and the establishment of a large-scale comprehensive automobile city, auto parts city, and auto repair center to form a large " 3S" unified car aftermarket.
Big "3S" City Features
The main function of the “3S†city is that it is a large market for automobile vehicles, a major market for automobile repairs, a large market for the distribution of auto parts, a manufacturer of complete vehicles and accessories, an operating company, and an automobile repair company. The places where users and others are gathered are the user's large warehouses, manufacturers' sales windows, and accessories wholesale distribution center.
The big “3S†city has the function of an information center. It can collect information on automobiles and their accessories, car repairs, and publish information. Mastering information means mastering wealth.
The big "3S" city has the ability to expand new products and promote high technology. For example, if manufacturers rent a few counters in the accessories city, they can sell their new products and promote their new products. It is easier for accessory users to find new product manufacturers in Auto Parts City. The “3S†city regularly holds new product exhibitions and hi-tech fairs, which can increase the visibility of products and increase its own popularity.
The big “3S†city is the link between government agencies, manufacturers, distribution companies, auto repair companies, and auto users. It is also where government departments centralize the management of the auto market. The administrative departments for industry and commerce can pass the “3S†city to regulate the automotive market; the quality and technical supervision departments can help the company to limit the disadvantages through the “3S†city.
The large “3S†city can provide one-stop services for banks, industry and commerce, taxation, postal services, etc. to operators. Operators do not have to worry about water, electricity, and safety, and do not need to directly face the government departments such as industry and commerce. As long as they focus on business, they can Now.
Big "3S" advantages
The first is the scale effect. Scale effect will inevitably lead to economies of scale, bring benefits to operators, and bring benefits to consumers. The big “3S†city has concentrated both the “buyer†and the “sellerâ€, and the transaction volume has increased substantially.
The large-scale market has provided a large number of wholesale business premises for large agents and production plants, played a leading and main channel role, and enabled the automotive market to function smoothly and normally.
At present, there are more than 600 auto repair companies in Beijing and their business volume is insufficient. If they are organized, they are large in scale, have a great reputation, and have a lot of business.
Followed by the convenience of customers. The large "3S" city is large in scale and full in variety. With a check, customers can buy the necessary accessories at different booths and fix the car in the auto repair center.
Lower the price. Big agents, distributors, and large and medium-sized manufacturers are stationed in big “3S†cities, and operators compete with each other. There are 10 stores and 20 stores in one accessory.
Therefore, auto parts are mostly at one price, consumers shop around, and they can play a role in stabilizing prices.
No inventory repair. In the big “3S†market, there is a large warehouse in the Auto Parts City. The auto repair shop can achieve “no inventory repairâ€, which can save a lot of liquidity, save many warehouse personnel and procurement personnel, and can significantly reduce costs.
Information network. The establishment of an information network for large “3S†cities is a matter of benefiting the country and the people. With the information, you can reduce the inventory of the accessories store, reduce the inventory of the repair shop, and the buyer can run a lot less. With the large "3S" city, this large warehouse can reduce thousands of small warehouses. The large “3S†city has established an information network. Enterprises can save a lot of liquidity, greatly facilitate car users and auto repair shops, and provide operators with means to make money.
Shopping assured. The “3S†city has quality supervision stations and full-time staff accepts complaints. Consumers can buy shoddy cars or accessories and can return or exchange goods. Loss caused by the business to compensate. Factory outlets, customers trust. In the Auto Parts City to establish a quality complaints station, consumer complaints, there are quality problems through professional identification, large "3S" city can be paid after the first to find businesses.
Distinguish the category, clearly price, high quality and better price. Taking auto parts as an example, the domestic auto parts are roughly divided into four categories: imported original parts, imported deputy parts, domestically-made matching parts, and domestically-made non-matching parts. If the above categories are indistinguishable, there will be huge profits. Price is the standard of classification, a symbol of quality, and the basis for equal competition. Clearly priced, consumers can clearly consume.
Interaction between the three "S"
The entire vehicle market, auto parts market and auto repair market are concentrated in one place and have very large complementarities. If there is an auto city next to the auto repair center, zero inventory can be achieved. Similarly, if Auto Parts City is close to the auto repair city, its sales volume and turnover will increase significantly.
Ordinary auto repair shops cannot afford experts and engineers, senior technicians and experienced masters. Many auto repair facilities are not fully equipped. Because modern automobile repairs require high, sophisticated, and sharp equipment, ordinary companies cannot buy or even cannot purchase advanced equipment at all. Even if these devices are available, the utilization rate is very low and it is not worth it. If the “3S†is implemented, each auto repair factory will pick up the piles, and all the technicians and testing equipment will be able to be set up. Everyone will share it. The utilization rate will be high, and the expenses shared by each family will be small. Large "3S" companies have much larger technological advantages, equipment advantages, and cost advantages than any large-scale auto repair companies in the country.
In the big "3S" companies, the difficult problems of overhauling components such as EFI, electronic components and automatic transmissions will be solved. Its popularity will increase day by day.
With the "3S," we can use it as a base to set up small, fast-repair shops, specialized shops, and various types of chain stores that are closer to users, and provide human, equipment, and technical support. In the past, it was remarkable that the 150,000 kilometers of cars in the hands of users had no major repairs. Now, the quality and reliability of automobiles can be significantly improved, and no major overhaul of 300,000 kilometers is commonplace. In this way, it is possible to overturn the past repair system (the mode of large-scale demolition and overhaul), implement a maintenance-oriented maintenance system, and implement a special repair and rapid repair system that focuses on single-piece replacement. Now, the general repair is more fuel system, lubrication system, cooling system, can be repaired without disassembly. Because there are no more repairs, many garages do just that.
There is a large, centralized “3S†market, and there are decentralized, special repairs, quick fixes, and chain stores that are close to the car users, which will have a great impetus for the development of the entire automotive market.
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